Amazon informed Californian users of the Amazon Associates program earlier today that they’d no longer be permitting Californians to participate by the end of September if the online retailer sales tax bill was made law. The governor today passed the bill, and Amazon says it has been forced to move the deadline up.
They aren’t wasting any time. As of today, June 29, 2011, Amazon says, Associates contracts with Californian residents are terminated.
If the governor was attempting to call Amazon’s bluff, it didn’t work. In grabbing for sales tax, the state has, it seems, eliminated a chunk of income tax.
Here’s the text of Amazon’s notification:
Hello,
Unfortunately, Governor Brown has signed into law the bill that we emailed you about earlier today. As a result of this, contracts with all California residents participating in the Amazon Associates Program are terminated effective today, June 29, 2011. Those California residents will no longer receive advertising fees for sales referred to Amazon.com, Endless.com, MYHABIT.COM or SmallParts.com. Please be assured that all qualifying advertising fees earned before today will be processed and paid in full in accordance with the regular payment schedule.You are receiving this email because our records indicate that you are a resident of California. If you are not currently a resident of California, or if you are relocating to another state in the near future, you can manage the details of your Associates account here. And if you relocate to another state in the near future please contact us for reinstatement into the Amazon Associates Program.
To avoid confusion, we would like to clarify that this development will only impact our ability to offer the Associates Program to California residents and will not affect your ability to purchase from Amazon.com, Endless.com, MYHABIT.COM or SmallParts.com.
We have enjoyed working with you and other California-based participants in the Amazon Associates Program and, if this situation is rectified, would very much welcome the opportunity to re-open our Associates Program to California residents. As mentioned before, we are continuing to work on alternative ways to help California residents monetize their websites and we will be sure to contact you when these become available.
Regards,
The Amazon Associates Team
Call our bluff and watch us rake in the chips Mr. Brown. Wow just WOW!
hi “)
This is so cool!
wtf
Sounds like a plan dude, good stuff.
http://www.total-privacy.se.tc
My understanding of what has happened here in a macro sense is that a corporation that controls a channel, or ‘highway’ if you will, of interstate commerce has told the users of that channel who come under the legal jurisdiction of a state government, that they may no longer fully utilize that channel of interstate commerce.So if it were a physical, private highway, it would, in essence, block users at the border.
Is that right?
Amazon’s move to drop CA affiliates does make it easier for me to start recommending B&H Photo and Video. But are other affiliate programs not affected as well? Or do they already comply with the new law? http://bit.ly/bhphotostore
All Affiliate programs are affected by this law.
Since this law forces anyone with a physical presence in California to begin collecting sales taxes for Californians, this increases the work of companies in other states selling to California. And it raises the prices of goods sold to Californians.
Thus B&H Photo and Video will also have to reconsider its Affliliate program in California.
This law essentially kills affiliate programs for Californians, reduces California income, and reduces income tax revenue for the state.
Amazon and other non-California companies can still sell without collecting sales taxes – as guaranteed by the US Constitution – so long as they have no California affiliates.
This is in sum a lose-lose law for the state.
Amazoon
Those a-holes in Seattle are running out of states to screw over!
I hate nothing more than tax dodgers… people who enjoy public roads and public institutions and yet find excuses not to help out.
Amazon has destroyed a lot of local businesses by abusing these laws.
SCREW YOU AMAZON TAX CHEATS!
Just do away with the affiliate program and send them to competitors. Bad call by Amazon. Void 1/10th of the populate in the US from being part of your program.
It will come back at them as most states, almost all facing some kind of financial shortfall, start to tighten the screws.
I’m sure you’ll see EBay and the like all try to take advantage of this.
I’d say Amazon’s customers are equally as culpable in this, and this won’t do anything to Amazon’s ability to undercut traditional brick and mortar operations. Shocked they have gotten away with this for so long, Amazon Canada never could get away with this in the first place.
@NotMyBro
Not sure why you’re blaming Amazon for tax-dodging. Amazon has NEVER paid sales tax on ANY sales. Businesses do not pay sales tax on sales they make; they merely pass along sales tax paid by their customers.
By eliminating their affiliate program for California residents, Amazon also eliminates their “physical presence” and eliminates the requirement to collect sales tax from their California customers.
If Amazon’s customers do not pay the use tax required by most states on such out-of-state purchases, it is the customer who is the tax dodger — not Amazon.
Why should Amazon be blamed for making a business decision? No one forced the state of California to reduce income taxes for former Amazon associates but it elected to do that in spite of a severe budget crisis.
Why aren’t people more upset with the imbalance in tax breaks being offered to the state’s citizens? Why should only former Amazon associates have to pay less income tax?